Sneak has long held that stock traders are grossly overpaid for doing a job that can typically be done equally well by a chimp with a stick. The latest evidence comes from researchers at Princeton University in the US. They have collected statistics to convincingly demonstrate that one of the biggest factors governing share price performance in the aftermath of an IPO is not to be found in the small print at the back of the launch prospectus - but in big letters on the cover. It seems the stock market gives lower values to firms with awkward names, regardless of the business factors that actually govern success. So get all post-modern and float your firm as Aeiou or Yuiop and you might as well flush fivers down the loo. Pick a nice, solid, easy-to-say name like Sneak Savings & Loan and you’re onto a winner, apparently.

30 May 2006